Which of the Following Statements Is CORRECT

question 46

Multiple Choice

Which of the following statements is CORRECT?

• A) The more depreciation a firm has in a given year, the higher its EPS, other things held constant.
• B) Typically, a firm's DPS should exceed its EPS.
• C) Typically, a firm's EBIT should exceed its EBITDA.
• D) If a firm is more profitable than average (e.g., Google), we would normally expect to see its stock price exceed its book value per share.
• E) If a firm is more profitable than most other firms, we would normally expect to see its book value per share exceed its stock price, especially after several years of high inflation.

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Definitions:

Organizational Reward System

The mechanisms and structures within an organization designed to recognize and compensate employees for their contributions.

Active Behavior

Engaging in actions that are intentional and purposeful.

360-degree Feedback

A process of self-evaluation and evaluations by a manager, peers, direct reports, and possibly customers.

Self-evaluations

The process by which individuals assess their own performance, strengths, and areas for improvement.